A college is facing cuts in staff in a bid to cut £1m from its budget.

Governors at Neath Port Talbot College have warned that it faces a £880,000 deficit for this year.

New principal Mark Dacey held meetings amongst the 650 full and part-time staff, saying that staff costs need to be reduced by £1m over a year.

He said that the funding the college receives from education and training body ELWa has not been increased sufficiently to meet national insurance and pension costs.

The principal hoped job cuts would come from voluntary redundancies and flexible working.

But he insisted that the college's 14,000 students would complete their courses despite the cutbacks.

Mr Dacey, who recently took over as principal, said "This is a difficult situation for the College, but we are left with little choice, given the college's financial situation.

"However, with the help of the trades unions, we intend to limit any compulsory redundancies by finding other ways of making savings, for example volunteers, fractional contracts, career breaks, secondment and flexible working."

Unions say they will discuss the issue with staff at the college

He said the college would ensure that existing students or the curriculum would not be adversely affected.

Mr Dacey denied that particular courses or departments were under threat, as the 30-day consultation period with staff started.

The college spends £22m, or more than 71%, of its budget on staff, when the overall sector average last year was around 65%.

Mr Dacey said it was not a matter of attributing blame but managing the finances.

Phil Markham, regional support officer with lecturers' union Natfe in Wales, said they would be consulting with local members to discuss what to do next.

"When there's any talk of redundancies there is obviously concern and we will want to do all we can to ensure that there are no compulsory redundancies."

We recognise that the current financial situation for further education colleges is challenging

ELWa spokesman

He said that a number of colleges are being affected by funding problems at the moment.

ELWa said it had been in discussions with the college over the last few weeks.

A spokesman said: "We recognise that the college is safeguarding its financial position by taking decisive action now and welcome the reassurances given to existing students.

"Although Neath Port Talbot College is predicting a budget deficit, the further education sector as a whole has received a budget increase, totalling 13.8% over the last two yeas, including a 4.76% budget increase for this year.

"Nevertheless, we recognise that the current financial situation for further education colleges is challenging. "

The spokesman said ELWa faced competing demands from school sixth forms and work-based training and that current funding arrangements "are not sustainable."

Modernisation of the funding system was being brought in across the whole sector, to address inequalities, he said.